Sensex, Nifty remain flat in late morning deals

Indian equity benchmarks remained flat in late morning deals, with both Sensex and Nifty trading marginally lower. In line with the larger peers, the broader indices also remained sluggish in late morning session. Negative cues from other Asian markets impacted trade over the Dalal Street. However, downside remained capped, as Lok Sabha passed a bill to amend the Factoring Regulation Act that seeks to help micro, small and medium enterprises by providing additional avenues for getting credit facility. The Factoring Regulation (Amendment) Bill, which was introduced on September 14, was passed by voice vote after a brief discussion.

On the global front, Asian markets were trading mostly in red, after China retained its benchmark rates for the fifth straight month as the economy continued to log robust recovery from the downturn caused by the coronavirus pandemic. The one-year loan prime rate was retained at 3.85 percent and the five-year loan prime rate was maintained at 4.65 percent. The one-year and five-year loan prime rates were last reduced in April. The one-year loan prime rate was lowered by 20 basis points and five-year rate by 10 basis points in April.

The BSE Sensex is currently trading at 38841.29, down by 4.53 points or 0.01% after trading in a range of 38776.19 and 38990.76. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.76%, while Small cap index was down by 0.48%.

The only gaining sectoral indices on the BSE were IT up by 2.06%, TECK up by 1.30% and Energy up by 0.38%, while Telecom down by 2.59%, Realty down by 1.69%, Auto down by 1.48%, FMCG down by 1.45% and Metal down by 1.13% were the top losing indices on BSE.

The top gainers on the Sensex were HCL Tech. up by 3.66%, Kotak Mahindra Bank up by 2.41%, Infosys up by 2.39%, Tech Mahindra up by 1.99% and TCS up by 1.57%. On the flip side, Bharti Airtel down by 2.90%, Maruti Suzuki down by 2.50%, Hindustan Unilever down by 2.36%, Ultratech Cement down by 2.10% and Nestle down by 2.09% were the top losers.

Meanwhile, with the government gradually unlocking the economy and business activity resuming, the Confederation of Indian Industry’s (CII) business outlook survey showed that India Inc's business sentiment has improved during July-September quarter. The latest CII Business Confidence Index has surged to the level of 50.3 in July-September 2020, bouncing back from its lowest reading of 41.0 recorded in April-June 2020. The survey was conducted during August-September 2020 and saw participation of over 150 firms across different sectors.

As per the survey report, the stellar recovery in the index has been supported by the remarkable increase in the Expectations Index (EI), which rose 46 per cent quarter-on-quarter, to the level of 55.2, as nationwide lockdown restrictions were lifted and businesses gradually began to reopen during the July-September quarter. CII Director General Chandrajit Banerjee said while a recovery is underway, it could be tremendously expedited through continued government support and handholding of businesses during this crisis.

Over half of the survey respondents stated that the weakness in domestic demand is likely to be the topmost risk to business confidence in the next six months. Nearly 30 per cent of the respondents feel that business activity may return to pre-pandemic levels by Q1 FY22. It added ‘With regards to the general economic prospects, more than third of the respondents (35 per cent) foresee a contraction higher than 4 per cent in India's GDP in the financial year 2020-21 as the significant setback to economic growth has been further aggravated by state-imposed lockdowns to curb local outbreaks’. Besides, it said, there are still many ad hoc restrictions being imposed by the states which are an impediment to the unlock process.

The CNX Nifty is currently trading at 11498.85, down by 6.10 points or 0.05% after trading in a range of 11477.15 and 11535.25. There were 14 stocks advancing against 36 stocks declining on the index.

The top gainers on Nifty were HCL Tech. up by 3.70%, Kotak Mahindra Bank up by 2.53%, Infosys up by 2.39%, Tech Mahindra up by 2.08% and Wipro up by 1.61%. On the flip side, Tata Motors down by 3.18%, Maruti Suzuki down by 2.50%, Hindustan Unilever down by 2.43%, Bharti Airtel down by 2.43% and Nestle down by 2.10% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 232.32 points or 0.95% to 24,223.09, Taiwan Weighted dropped 56.95 points or 0.44% to 12,818.67, Shanghai Composite declined 13.84 points or 0.41% to 3,324.25, Jakarta Composite lost 11.03 points or 0.22% to 5,048.19 and KOSPI fell 5.04 points or 0.21% to 2,407.36. On the flip side, Straits Times advanced 5.89 points or 0.24% to 2,503.60.